Modelling of Construction Firms Sustainability Ilias Said Omar Osman Mohd Wira Mohd Shafiei Waleed Mohamad Abdo Rashideh Tee Kuan Kooi Universiti Sains Malaysia1

ABSTRACT Sustainability is a hot debatable issue over the world, constantly being discussed by people from all walks of life. The construction industry is important industry for the development of every society but it takes up a lot of un-renewable resources is also considered as the main contributor of natural resources depletion and responsible for high levels of pollution. It is also considered one of the attributes that pose climate changes and other environmental threats. Consequently, the achievement of sustainable construction posses stiff challenges. Therefore, there is a need to look into the fundamentals of sustainability to achieve sustainable construction. There is a wide belief which requires for individuals, construction firms and societies to find models, metrics and tools to articulate the extent and the ways in which, current activities are unsustainable. Developing a standard measure contributes to achieving sustainability in all forms. In addition, it provides decision and policy makers with all data and information of interest to draw plans to achieve the principles of sustainable development. This conceptual paper attempts to develop a framework to assess construction sustainability in Malaysia. These indicators will include an integration of all fundamentals that contribute to a sustainable development, which are, environmental, economic and social factors. Keywords: Sustainability, construction industry, indicators, assessment. THE IMPORTANCE OF SUSTAINABILITY There is growing realization among leading scientists, the public and politicians that we are using the planet’s resources in ways which exceed its long-term capacity of use and undermines the vital life support system of the planet. In the last decade the difference in living conditions between rich and poor people, both between and within countries, has also widened, exacerbating environmental damage (TCPA, 2003). This scenario points out that sustainability is merely not a “hear-say” scenario, but it has its effects on both the local and global populace. Sustainability is considered as a global issue and it requires a global solution (Ugwu & Haupt, 2007). There is increasing pressure on the need to achieve sustainability and the relevant authorities must formulate effective ways to achieve sustainability and to be implemented as a cornerstone for future policies (Kühtz, 2007). This is what makes sustainability an important issue being debated in large scale of interests all over the world. By reviewing previous studies on the subject of sustainability, most scholars use the definition that emerged from the Brutland Commission "Our Common Future" with regards to sustainability. The report defined sustainable development as, “… the development that meets the needs of the presents without compromising the ability of future generations to meet their own needs” (WCED, 1987). This concept focuses equally on the economic, environmental and social values (Ding, 2008); making it the benchmark definition that has been adopted by various publications to base ideas, claims and support sustainability related findings. The integration among the three sustainable fundamentals make sustainability a holistic concept thus giving the implication efforts in creating sustainability will have to coincide with satisfying the needs of shareholders. Sustainability can be considered as a condition that can’t be achieved overnight. Sustainability may be perceived as a 1

The authors acknowledge the Science Fund (MOSTI) for providing the financial support for this research.

long term exercise carried out by various parties to achieve a sustainable condition within the parameters of economic, social and environmental cornerstones. The fundamental target of the construction industry is to achieve sustainability as well as playing the role as economic driver for the society. The principles of sustainable construction projects attempts to adhere to the definition of sustainable development by protecting the environment and enabling all people to improve their life through the pursuit of economic and social objectives. The construction industry should take into account the concept of sustainability to promote a positive society development and at the same time keep at bay the negative impacts that construction may have towards the environment. The needs of future generations have always been keys to the sustainability concept. As for sustainable development, there exists three key principles (Alameda County, 2002):  Build for the long term – construct buildings that are durable and long lasting.  Build for our children – make their environment safe.  Build for the planet – make the materials from sustainable resources. A sustained construction industry is reflected by the progress of sustainable development fundamentals; which are social and economic factors alongside with the environmental factor. Therefore, there is a need for developing countries i.e. Malaysia to have the ability in assessing sustainability of their projects (Ugwu & Haupt, 2007), by using a combination of environmental, social and economic factors. The matter at hand is how to sustain the construction industry as economic driver for the society as well as working friendly with the environment. A panacea in the form of a tool or technique that help enable the construction industry to function in both way, as an economic driver and being environmentally friendly should be created. The danger of implementing a sustainable development strategy and policy arises when the policy does not practice a uniform or parallel emphasis of sustainability fundamentals; for instance; to emphasize on the technological advancement while neglecting the environmental issues. To avoid this, indicators specifically designed for Malaysian scenario should be formulated and implemented to ensure a more structured and balanced approach towards achieving sustainability in the construction industry. Previous studies pointed out the benefits of formulating the right indicators and assessment framework in order to improve construction sustainability. The previous studies done, is considered as a contribution towards sustainability science in translating the global objectives of sustainability into project level decision-making to achieve a sustainable construction environment (Ugwu & Haupt, 2007). Sustainability plays a powerful role in the social level, i.e. having the ability to provide access to good education, creating goodwill, improving community consultation and promoting interest in various fields. Firstly one should consider the significant issues influence the area such as poor health, crime and social exceptions, before any actions to make an area more sustainable can be taken (Boyko et al, 2006). Therefore, it is very important to consider the best criteria during the assessment, which will in turn reflect the success rate of achieving social sustainability. To deal effectively with sustainability issues, one should consider the need for extra knowledge, identification of knowledge database and be resourceful to put to practice new skills to support this process. By improving the current situation, it will in turn help to develop capabilities of management and leadership to support the promises to sustainable development (Gloet, 2006). Form the economic sustainability perspective; the issues of sustainability deals with a wide range of factors within the local and global level (Gloet, 2006), making sustainability a common issue to different business of different industries (Azapagic, 2003), Different industries may have different approaches towards attaining sustainability objectives. The different approaches may pose different practices in work (Gloet, 2006). Thus in sustainable development, there is a need to be aware to design and construct for sustainability bearing in mind the different sustainability approaches that the end user may have. Sustainable development must account for the integration of social needs, economic and environmental impacts of the sustainability to chose the strategy (Kühtz, 2007). From the construction point of view, measurement is essential in order to have good management and performance improvement (Torbett, Salter, Gann, & Hobday, 2001). In addition to that, measuring is also used to ensure that sustainability objectives are being met (Azapagic, 2003). This statement is also applicable in the implementation of sustainable development policies and initiatives by construction firms. Most of the sustainability assessment methods developed by previous researchers only concentrated on environmental elements. Long term effects can be seen as one

of the main the perpetrators of environmental problems, the fiercely competitive construction firms may find it difficult to mend their ways. Sustainable Construction Construction activities; being multi-faceted in nature, consumes huge portions of raw material in order to produce the end product. The conventional method of construction; where lean construction and industrialized concepts are not a practice, produces formidable amounts of waste. Construction wastes consists of hazardous materials and are often not recyclable, thus giving the deduction that construction activities are a major contributor to environment pollution. The impact of construction industry is produces undesirable remnants which includes depletion of non-renewable resources, destruction of landscapes and creation of health and safety problem both relating directly & indirectly to the people involved with the construction industry (Augenbroe & Pearce, 1998). Though the construction industry is considered important for the progress of a society (Ding, 2005; Patermann, 1999), but at the same time it should pay attention for environmental protection (Ding, 2005) in order to achieve sustainability. Application of the sustainability concept to project development requires great effort from different disciplines (Ding, 2005; Ding, 2008). With every project undertaken, the elements of cost, time and quality will always be in play throughout the duration of the project. A sustainable development should take account analyzing the various construction activities. The various stages in construction activities each have its own respective impact to the three fundamentals of sustainability being; social, economic and environment. Therefore, in efforts to achieve sustainability, minimizing pollution effects to the environment alone is not enough, but rather it has to incorporate the fundamentals of both social and economic sustainability. Economic growth development and the long-term effects on living standards has always been the matter of concern for people and has recently escalated into becoming a global concern (Ding, 2008). Environmental protection has always been an issue associated with the construction industry (Ding, 2005; Yahya & Boussabaine, 2006). Efforts put in by all the parties concerned in the construction industry, has made the negative environmental impacts of construction projects to be wider better understood by architects, engineers, operators, and owners (TCPA, 2003). The Malaysian context CIB report (1998) raised the issue of protecting the environment during construction process and introduced steps to reduce environmental impact that results from construction. Housing has been the main thrust of the Malaysian construction industry since the 1980s. Construction, being an industry that churns out substantial quantities of waste, it is inferred that a significant amount of construction waste is emitted from the housing sector. Therefore, by raising environmental standards and creating sustainability awareness in housing contractors, it is possible to make a significant contribution to the efforts of creating sustainability. Countries that faces declining trend in construction, sustainability is an important issue for them (Bon & Hutchinson, 2000). Construction is important to the economical growth of every country ("Editorial understanding the social and economic value of construction," 2006; Raynsford, 1999; Seaden & Manseau, 2001). Sustainable construction is the construction that contributes to the sustainable development. With the implementation of sustainable construction, the construction firms are bound to bring about positive changes; i.e. less pollution, waste and even constitutes to the well-being of future generations. The industry contributes to economic development of Malaysia by developing infrastructures in all phases of development which is turn spurs economical growth. The construction industry is primarily responsible for putting together all necessary resources and production facilities or structure. Lack of awareness for sustainable development principle is one of the barriers of sustainability (Azapagic, 2003). A number of publications reveal that experts agree and emphasize more on the environmental aspects in creating sustainability rather than looking social and economic indicators. In the case of Malaysian construction firms, the perception towards sustainability within the industry is that, environmental protection can only drive their costs up, and hence affecting their competitive edge. Because of this, an assessment method integrating environmental, economic and social factors needs to be developed so that the industry could see the benefits of implementing sustainable development strategies and policies. Hence, it is imperative to develop a framework specifically tailored to the Malaysian scenario because as a developing country with its own unique characteristics, the newly developed framework could be the answer for a multitude of problems in relation to construction sustainability in the country.

Figure 1: Sustainability Implementation Framework for the Malaysian Construction Firm (self-developed) The framework works in two stages; the first being to develop the sustainability concept. Aspects of environment, economy and social are reflected with the understanding and formulation of the sustainability concept. Cost mitigation and balance between the environment to both economy and social are crucial to prevent an unbalanced segregation of funds allotted in creating sustainability. This is imperative as construction firms might neglect the need for sustainability if the costs of creating environmental sustainability are high. The second stage of the framework views the implementation of sustainable development with a solid understanding of the concept. With all the three sustainability factors taken into account in the first place, it is highly possible to bring about Environmental, economy and social benefits. Frameworks are only effective for macro level decision issues while for the micro level, it is best to use a holistic approach to facilitate decision making (Ugwu & Haupt, 2007; Ugwu et. al., 2006). The framework only concentrates on a wider national level and is not intended to address micro-level integrated decision-making issues. The developed Malaysian framework could be the right impetus to give momentum to promoting sustainable development amongst the country's construction firms. It is hoped that construction firms will not be scared and put off by the term "sustainable development", perceiving it to be cost additions. Rather, with an assessment tool integrating all the fundamentals of sustainable development, (environmental, economic and social), the firms will form a learned judgments towards construction sustainability. Sustainability Assessment A number of sustainability assessment framework has been used to evaluate firms performance (Singh et. al., 2009), and the integration of the three bottom line concept assessment is necessary to demonstrate that a project can be classified as sustainable development (George, 1999). To ensure optimization and effectiveness of sustainability implementation, the progress and shortcomings require to be measured and monitored (Singh, et al., 2009). Measuring and monitoring will be through the assessment of sustainability based on the combination of indicators for the fundamentals of sustainable development. Ding (2008) claim that multiple dimensional sustainability models were based on embracing economic, social and environmental values. The construction industry sustainability index can be developed as a model to address the important criteria in relation to sustainable construction decisions (Ding, 2005). The index captures the complexities of the ecosystem, yet remains simple enough to be used (Ding, 2005). Lutzkendrof & Lorenz (2006) pointed out, that there is a demand for

complicated as well as simple assessment process and presentation of assessment results. The assessment functions in several ways in providing a common set of standards and goals. Also, it will play a good role in creating the body of knowledge and expertise within the design team of building and construction firm (Cole, 1998). Subsequently the sustainability assessment then acts as a means for education and empowerment (Mathur et. al., 2008). There is insufficient effort to measure sustainability with integral approach that encompasses environmental, economic and social aspects (Singh, et al., 2009). The challenge of sustainable development for any business is to acquire quality of life presently without compromising the quality of life of future generation (A. Azapagic, 2003). Sustainable construction can be achieved based on willingness and ability of the construction firms to drive change (Bourdeau, 1999). Formulation of policies that gives change to economic market forces, are required to govern the activities of professionals in the construction industry (Bon & Hutchinson, 2000). To sustain the success of the construction firm, information is crucial for creating a consensus for a sustainability assessment (Gomes & Silva, 2005). In addition to that, an effective stakeholder participation is needed to develop custom indicators in developing countries to address sustainability (Ugwu & Haupt, 2007) and Malaysia is considered one of the developing countries with its own custom features. By developing an indicator system which suits the construction industry, present problems can be identified and the solution can be subsequently proposed. Indicators represent the method to develop and measure sustainability progress in an easy and understandable way. These indicators set are aimed to measure positive movement towards sustainable activities for the systems to be measured (Guy & Kibert, 1998). Selecting indicators of the framework will depend on a number of factors such as availability of data and complexity of the analysis (Azapagic & Perdan, 2000). Critical indications of sustainable construction will focus on issues such as land use, water, energy and material use (Azapagic, 2004). Therefore, quantifying the amounts and types to these indicators in construction can provide a possible solution to address the issues of sustainability in construction. Sustainability indicators is intended on reflecting the application in real situations, where the usability considers principles underpinning sustainable development (Ugwu, et al., 2006), as well as playing the role to translate sustainability issues into quantifiable measures of the integration of the three bottom line factors (Azapagic, 2004). Indicators are also considered as a tool for policy making by experts and stakeholders (Singh, et al., 2009). The goals of creating indicators are to monitor the progress, understand sustainability and to educate the stakeholders involved in the process. Indicators must have the ability to translate both internally-relevant and externally-important sustainability issues into the representative measures of performance and subsequently provide a holistic assessment for sustainability and reduce the number of criteria to help decision-makers (Azapagic, 2004). CONCLUSION There is no doubt that sustainability issues are regarded as a problem at global and local levels. Overpopulation and the depletion of natural resources have prompted the world population to be aware of the seriousness of the current situation and address to the matter at hand. Preventive measures to reduce the problems of in-sustainability should be taken to ensure a decent living for future generations. The study attempts to produce a model can be used in the construction firms. This model will serve the three fundamentals of sustainability. This model can be applied to the construction firms of Malaysia and elsewhere in the world; which has the same characteristics as the Malaysian construction industry. The benefit of this study is not only environmental protection, rather it is a combination of benefits which includes internal and external interests for the construction firm, for the employee, owners and investors. These combination of benefits reflect social, economical and environmental protection and at the same time maximizing profits while keeping the cost of input to a minimum. In order to encourage sustainability practice in the construction industry, incentives and rewards should be awarded to the rightful party who practices sustainability. The incentives are vital to the efforts of promoting a sustainable practice in construction firms. Despite the governmental support, the application of sustainable principles will still result in an increased cost and subsequently an increased price for the clients. Therefore, it is in the best

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